Nonprofit Financial Management Exam Review
Course Introduction
Nonprofit Financial Management explores the principles, tools, and practices essential for effective financial stewardship in nonprofit organizations. This course covers topics such as budgeting, accounting, financial reporting, cash flow management, securing and managing grants, and compliance with regulatory and ethical standards. Students learn how to interpret financial statements, develop funding strategies, and employ best practices for sustainability and transparency, enabling them to make informed decisions that support an organizations mission and long-term growth.
Recommended Textbook
Essentials of Accounting for Governmental and Not for Profit Organizations 10th Edition by Paul
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14 Chapters
1903 Verified Questions
1903 Flashcards
Source URL: https://quizplus.com/study-set/3264
Page 2
Chapter 1: Introduction to Accounting and Financial
Reporting for Governmental and Not-For-Profit Organizations
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144 Verified Questions
144 Flashcards
Source URL: https://quizplus.com/quiz/64820
Sample Questions
Q1) Which of the following is not an environmental difference between governments and for-profit business enterprises?
A) Organizational purposes.
B) Sources of revenue.
C) Role of the budget.
D) Donor restrictions.
Answer: D
Q2) The ______ Fund accounts for all resources other than those required to be accounted for in other funds.
A) Special Revenue
B) General
C) Enterprise
D) Agency
Answer: B
Q3) The Federal Accounting Standards Advisory Board and the Governmental Accounting Standards Board are parallel bodies under the oversight of the Financial Accounting Foundation.
A)True
B)False
Answer: False Page 3
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Page 4
Chapter 2: Overview of Financial Reporting for State and Local Governments
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143 Verified Questions
143 Flashcards
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Sample Questions
Q1) Capital assets must be itemized on governmental fund balance sheets.
A)True
B)False Answer: False
Q2) In addition to government-wide statements,governments are required to prepare fund financial statements within which three categories of funds?
Answer: Governmental Proprietary Fiduciary
Q3) Prior-year data is required for government-wide financial statements.
A)True
B)False
Answer: False
Q4) The General Fund is always a major fund for purposes of financial reporting.
A)True
B)False
Answer: True
Q5) The statistical section of the CAFR contains the combining schedules of non-major funds.
A)True
B)False Answer: False
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Chapter 3: Modified Accrual Accounting: Including the Role of
Fund Balances and Budgetary Authority
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154 Verified Questions
154 Flashcards
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Sample Questions
Q1) List the four eligibility requirements for a government to record revenue from a nonexchange transaction.Provide a brief explanation for each.
Answer: Required characteristics of recipients The recipients of the funds must have the characteristics specified by the provider.Time requirement If there is a specific time requirement for expenditure,revenue is recorded in the time period specified Reimbursement If money is only received upon incurrence of qualifying outlays,revenue is recognized when expenditures have been incurred Contingencies Pledged resources receivable contingent upon a certain event are recorded as revenue when the contingency has been met.
Q2) Which of the following results in an encumbrance?
A) Place a purchase order.
B) Receive goods previously ordered.
C) Receive an invoice on goods previously received.
D) Payment of an invoice previously received.
Answer: A
Q3) What are the four classes of nonexchange revenues?
Answer: Imposed nonexchange transactions Derived tax revenues
Government-mandated nonexchange transactions Voluntary nonexchange transactions
Page 6
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Chapter 4: Accounting for the General and Special Revenue Funds
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128 Verified Questions
128 Flashcards
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Sample Questions
Q1) The term special item is defined as:
A) Frequent and unusual but within management's control.
B) Unusual or infrequent but within management's control.
C) Frequent and unusual and not within management's control.
D) Unusual or infrequent and not within management's control.
Q2) $60,000 of property tax owed to the city of Akron will not be collected within 60 days after year end.The year end journal entry to record this information would include a:
A) A credit to Revenues Control.
B) A debit to Deferred Revenue - Property Taxes.
C) A credit to Income Taxes Receivable.
D) A debit to Revenues Control.
Q3) The General Fund accounts for any resources not reported in one of the other funds.
A)True
B)False
Q4) What is the different accounting treatment with respect to supplies inventory using the Consumption versus the Purchases method?
Q5) What is the difference between an extraordinary and special item?
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Chapter 5: Accounting for Other Governmental Fund Types:
Capital Projects, debt Service, and Permanent
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170 Verified Questions
170 Flashcards
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Sample Questions
Q1) Fund balances of debt service funds are classified as assigned or unassigned according to the categories identified in GASB Statement 54.
A)True
B)False
Q2) At the inception of a capital lease agreement,
A) A liability is incurred and reported in the governmental fund account.
B) A liability is incurred and reported in the government-wide financial statements.
C) An expenditure is recorded in the governmental fund account.
D) Both B and C
Q3) Only the General Fund has a positive Unassigned Fund Balance.
A)True
B)False
Q4) Which of the following projects would normally be accounted for in a capital projects fund?
A) The construction of a parking garage operated as an enterprise fund.
B) The construction of a police station addition.
C) Payment of interest on bonds issued to finance the construction of a new city hall.
D) Both A and B would be accounted for in a capital projects fund.
Page 8
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Chapter 6: Proprietary Funds
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143 Verified Questions
143 Flashcards
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Sample Questions
Q1) A city government has decided to build and operate a convention center.Identify what factors should be considered in deciding whether to account for the convention center as an Enterprise Fund or as part of general governmental activities?
Q2) Under GASB Statement 34,enterprise funds must be used in which of the following circumstances?
A) When debt is backed solely by fees and charges.
B) When services are provided to other governmental units for a fee.
C) When the activities are expected to make a profit to be used to fund other government programs.
D) None of the above; enterprise funds are optional.
Q3) Describe the requirements for disclosure of segment information for enterprise funds.
Q4) Why might it be desirable for an enterprise fund to operate at a profit?
Q5) An enterprise fund should be used when the government has a policy to establish fees to cover the costs of providing services for an activity.
A)True
B)False
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Page 9
Chapter 7: Fiduciary Trustfunds
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162 Verified Questions
162 Flashcards
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Sample Questions
Q1) Fiduciary Funds are used to account for assets held by a government acting as a trustee or agent for entities external to the governmental unit: Including individuals,organizations,and other governmental units.
A)True
B)False
Q2) The City of DeKalb contributes to three pension plans: (1)a statewide pension plan for nonuniformed personnel,(2)a locally administered plan for police officers,and (3)a locally administered plan for firefighters.The City is trustee for the plans for police officers and firefighters.Which of the following is true?
A) The City would maintain trust funds for the police and fire plans but not the statewide plan.
B) When making contributions from General Fund resources to the police and fire plans, the General Fund would debit Other Financing Sources-Transfers Out and the Pension Trust Fund would credit Transfers In.
C) Both of the above.
D) Neither of the above.
Q3) Contrast the accounting for internal and external portions of investment pools.
Q4) Contrast the purpose of Private-purpose Trust Funds and Permanent Funds.
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Page 10
Chapter 8: Government-Wide Statements, capital Assets,
long-Term
Debt
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162 Verified Questions
162 Flashcards
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Sample Questions
Q1) Internal service funds are most commonly reported in which section of the Government-wide financial statements?
A) Governmental Activities
B) Business-type activities
C) Both A & B
D) Neither of the above.
Q2) Which of the following is true regarding the government-wide financial statements?
A) Government-wide statements include the Statement of Net Assets, the Statement of Activities, and the Statement of Cash Flows.
B) Government-wide statements are prepared using the economic resources measurement focus and accrual basis of accounting.
C) Both of the above are true.
D) Neither of the above is true.
Q3) When preparing government-wide statements,depreciation expense must be eliminated.
A)True
B)False
Q4) With regard to the government-wide statements,list the required statements.
Page 11
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Chapter 9: Advanced Topics for State and Local Governments
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104 Verified Questions
104 Flashcards
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Sample Questions
Q1) Special-purpose governments that are engaged in both governmental and business-type activities or in more than one governmental activity are required to include which items in its financial reporting?
Q2) What are the criteria outlined in GASB Statement 39: Determining Whether Certain Organizations Are Component Units for requiring public college foundations to be reported as discretely presented components in the college's financial reports?
Q3) Which of the following is true regarding the Statement of Cash Flows for a public college?
A) Cash received for interest is reported as an increase in cash flows from investing activities.
B) Cash paid for interest is reported as a decrease in cash flows from either noncapital or capital and related financing activities.
C) Both of the above are true.
D) Neither of the above is true
Q4) Public colleges must depreciate infrastructure and may not use the modified approach.
A)True
B)False
12
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Chapter 10: Accounting for Private Not-For-Profit Organizations
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154 Verified Questions
154 Flashcards
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Sample Questions
Q1) The entry to record the expiration of program restrictions includes which of the following?
A) Debit Reclassification from Temporarily Restricted Net Assets.
B) Credit Performance Expense.
C) Debit Reclassification to Unrestricted Net Assets.
D) Credit Reclassification from Temporarily Restricted Net Assets.
Q2) Which of the following would not be an example of a voluntary health and welfare organization?
A) A city owned hospital.
B) A private mental health facility.
C) A family planning agency.
D) A food bank.
Q3) Private not-for-profit organizations are not required to record depreciation expense. A)True B)False
Q4) Contributions to a private not-for-profit are recorded at fair market value at the date of receipt.
A)True
B)False
13
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Chapter 11: College and University Accounting
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128 Verified Questions
128 Flashcards
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Sample
Questions
Q1) Private colleges and universities use the same accounting and reporting standards as public colleges and universities.
A)True
B)False
Q2) Under NACUBO guidelines,the current period provision for uncollectible accounts should be reported as:
A) Bad debt expense.
B) A reductions in revenue.
C) Transfers.
D) None of the above.
Q3) A Pooled life income fund is a split-interest agreement.
A)True
B)False
Q4) Investor-owned proprietary schools are subject to the standards issued by the GASB.
A)True
B)False
Q5) With respect to private colleges and universities,why are quasi-endowments not classified as permanently restricted net assets while true endowments are?
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Chapter 12: Accounting for Hospitals and Other Health Care
Providers
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99 Verified Questions
99 Flashcards
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Sample Questions
Q1) Which of the following is correct with respect to the recording of charity care for health care organizations?
A) Charity care is recorded as revenue and an adjustment is recorded for the difference between the value of the revenue and expenses incurred in providing health care services.
B) Revenues are not recorded for the value of charity care services provided, but related expenses are included with other expenses on the Statement of Operations.
C) The value of foregone charity care revenue is deducted as a charitable contribution.
D) Management's policy for providing charity care and the level of charity care provided is an optional disclosure.
Q2) For hospitals,contractual adjustments to 3rd party payers,such as insurance companies,are recorded with a debit to Contractual Adjustment expense and a credit to accounts receivable.
A)True
B)False
Q3) Identify income items which should not be included in the determination of the performance indicator by a hospital.
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Page 15
Chapter 13: Auditing, tax-Exempt Organizations, and Evaluating Performance
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144 Verified Questions
144 Flashcards
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Sample Questions
Q1) To compute the operating ratio-enterprise funds,one would need to look in the CAFR for the:
A) Government-wide Statement of Net Assets.
B) Proprietary funds Statement of Revenues, Expenses, and Changes in Fund Net Assets.
C) Both of the above.
D) Neither of the above.
Q2) Under the terms of the Single Audit Act and its amendments,what percentage of federal awards expenditures must be selected for audit?
A) High Risk Auditee: 100%; Low Risk Auditee: 50%
B) High Risk Auditee: 100%; Low Risk Auditee: 25%
C) High Risk Auditee: 50%; Low Risk Auditee: 25%
D) High Risk Auditee: 50%; Low Risk Auditee: 0%
Q3) Which of the following may be deducted in computing income from unrelated business activities?
A) Ordinary and necessary business expenses.
B) $1,000 exemption.
C) Charitable contributions.
D) All of the above.
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Chapter 14: Financial Reporting by the Federal Government
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68 Verified Questions
68 Flashcards
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Sample Questions
Q1) Federal agencies which are required to report a Statement of Custodial Activity have transactions which are similar to which fund type of a state or local government?
A) Internal service funds
B) Capital projects funds
C) Agency funds
D) Permanent funds
Q2) Typically budgetary authority that is not obligated by a federal agency before the end of the fiscal year is returned to Treasury.
A)True
B)False
Q3) The difference between assets and liabilities of a federal agency is comprised of Net Assets and may be classified as Unrestricted,Restricted,and Invested in Capital Assets Net of Related Debt.
A)True
B)False
Q4) List the financial statements required of every federal government agency and indicate whether the statement is prepared using the accrual or budgetary basis of accounting.
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